In a large Dutch oven or skillet, heat the olive oil over medium heat. Add the diced bacon and cook until crispy. Remove the bacon with a slotted spoon and set aside.
Season the chicken pieces with salt and pepper, then dredge them in flour. Add the chicken to the pan with the bacon fat and brown on all sides. Remove the chicken and set aside.
Add the chopped onions and crushed garlic to the pan and sauté until softened. Add the sliced carrots and mushrooms and cook for another 5-6 minutes, stirring occasionally.
Stir in the tomato paste, then pour in the red wine and chicken broth. Add the bay leaves and fresh thyme sprigs.
Return the chicken and bacon to the pan. Bring to a simmer, then cover and cook over low heat for 1.5 hours, or until the chicken is tender and the flavors have melded.
Serve hot, garnished with chopped fresh parsley. Serve with crusty bread or mashed potatoes.
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